One Madison Park

Judge Kevin Gross, in an opinion released yesterday, said the case involving the luxury tower at 23 East 22nd Street, is placing an untold burden on his courtroom and cited an inability and unwillingness of the various parties to resolve several key disputes in the bankruptcy. The decision forces part of the case to start from scratch in New York state court after 1.5 years in bankruptcy court in Delaware.

“These adversary proceedings are extremely contentious and there is minimal cooperation among the parties,” Gross wrote in his opinion. “It’s fair to say the parties won’t agree on what day it is.” [more]

From left: One Madison Park, Stephen Ross of Related and Ziel Feldman of HFZ Capital Group

Related and HFZ Capital Group cleared a key hurdle in their effort to take over the beleaguered One Madison Park condominium tower on Thursday, after the deadline for parties to file competing bids passed with no additional offers.

Related, through an entity known as One Madison FM, had initially been HFZ’s rival to become the sponsor of the 50-story tower at 23 East 22nd Street, which creditors pushed into bankruptcy in June 2010. But in September, Related and HFZ joined forces to bid for control of the property through a bankruptcy auction, which had been scheduled for Dec. 13.

The lack of competing bids allows the entity that controls One Madison, FKF Madison Group Owner LLC, to move ahead with Related and HFZ’s proposal to pull the 69-unit property out of bankruptcy. [more]

From top: Amy Herman, senior vice president of Halstead Property, Todd Lewin, managing director of Good Property, One Madison Park and the 10th floor unit

Construction at One Madison Park may be stalled, but that hasn’t stopped a pair of unit owners at the condominium tower from seeking tenants for their investment property.

One of two rentals available at the development, unit #10A is getting its second tenant Dec. 1, and he’ll pay $9,000, or $1,100 more per month than the previous occupant, according to the individual’s agent, Todd Lewin, managing director of real estate services firm Good Property.

Buyers Angela and Thomas Chen paid $2.04 million for the 1,328-square-foot two-bedroom apartment in September 2009, according to property records, shortly before the 50-story tower went into foreclosure and its developers, Ira Shapiro and Marc Jacobs, saw the property slide into bankruptcy. [more]

Top left: Ziel Feldman; Bottom left: Steve Ross; Right: One Madison Park

The new holders of the senior debt at One Madison Park issued subpoenas yesterday to force investor Green Bridge Capital to disclose its relationship with Ziel Feldman’s HFZ Capital and why the firm is refusing a June 30 offer to accept a new plan backed by Related Cos.
The new proposal, by an entity called One Madison FM, is designed to bring in new bidders through an open auction and substantially raise the value of the property. Sources say the new entity is backed by Related Cos. Chairman Steve Ross, who is pursuing a plan to become the new sponsor of One Madison Park.
Related, one of the largest and most respected real estate developers in the city, is working with Amalgamated Bank on a financial plan to help pay off creditors of the bankrupt condominium at 23 East 22nd Street, and complete construction.

“He wants to develop it,” according to a source familiar with Ross’ plans for the property. [more]

Ziel Feldman and One Madison Park

Amalgamated Bank has acquired the senior piece of the One Madison Park condominium mortgage loan from iStar Financial, according to federal bankruptcy records obtained by The Real Deal, jeopardizing a rescue plan submitted earlier this month by HFZ Capital.

Manhattan-based Amalgamated already held the $78.5 million junior piece of the mortgage loan, and a New York state Supreme Court judge refused to block the deal despite a $75 million lawsuit from HFZ, a distressed real estate firm led by investor Ziel Feldman.

HFZ asked the judge to block the deal on the grounds that Amalgamated, after initially promising to sell the junior piece to HFZ in November 2010, reneged on that deal and swooped in on the senior note after HFZ filed a rescue plan in U.S. Bankruptcy Court. [more]

HFZ Capital’s Ziel Feldman, Green Bridge’s Cevdet Caner and One Madison Park

A long-awaited reorganization plan was submitted in the One
Madison Park bankruptcy case late yesterday evening giving
an outline that could finally lead to the troubled condominium
settling millions of dollars in claims and resuming sales.

The plan, submitted to the U.S. Bankruptcy Court in Delaware,
calls for senior lender iStar Financial to get $162 million in the
form of a secured note.

In addition, $12.5 million in mechanics liens would be recovered
in the form of cash, $15 million to $20 million in “unclassified
claims” would be recovered in immediate cash, deferred cash
and other payments and another $160 million to $180 million in
unsecured claims would be recovered at the rate of 3 to 5 percent. [more]

Steve Ross is the latest developer angling for a piece of One Madison Park, the skinny glass condo at 23 East 22nd Street that’s been mired in lawsuits since its owners ran out of cash in 2009. According to the Wall Street Journal, Ross’ Related Companies is working on a bid with Amalgamated Bank, one of the project’s junior lenders, to wrest control of the property through a buyout of senior lender iStar Financial’s debt. The Amalgamated plan was revealed in yet another lawsuit filed yesterday by Ziel Feldman’s HFZ Capital, which is expected to submit an official rescue plan for One Madison to federal bankruptcy court in Delaware within days. [more]

Ziel Feldman’s Manhattan-based HFZ Capital Group is setting its sights beyond Manhattan island, as it has tapped Jacqueline Finkelstein to head a team focused on purchasing performing, non-performing notes and fee positions across the country. Finkelstein had previously worked for the Moinian Group, but left the firm (she declined to discuss her departure) to pursue some real estate opportunities of her own. Now that most of them have wrapped up, she said she is focused solely on her new role with HFZ Capital, which she started about two months ago. “I just feel HFZ permits me to have access to deals I haven’t been able to access in the past,” she told The Real Deal. TRD [more]

Ira Shapiro, Cevdet Caner, Ziel Feldman and One Madison Park

The developers of the One Madison Park condominium said they expect to formally submit an official rescue plan for the troubled project within the next two weeks, according to federal bankruptcy court documents obtained by The Real Deal.
The developers, including Ira Shapiro and billionaire investor Cevdet Caner, have been negotiating with HFZ Capital’s Ziel Feldman on a plan to buy the luxury tower, which is at 23 East 22nd Street, for $165 million, plus pay more than $40 million to complete construction on the building.
“Substantial negotiations regarding a plan have taken place over the past six weeks and the parties have made significant progress in narrowing the open issues,” wrote attorney Erin Fay, who represents the developers. They wrested control of the project from Shapiro earlier this year. “The debtors anticipate receiving committee comments to the draft plan and wrapping up negotiations on the remaining open issues within a week or two.” [more]